Gold futures saw small gains Friday as the yellow metal looked to book a modest weekly advance, finding only a little haven-related lift from geopolitical worries surrounding Britain’s planned exit from the European Union and broader equity market weakness.
Gold for December delivery GCZ8, +0.26% on Comex rose $2, or 0.2%, to $1,217, while December silver SIZ8, -0.16% was little changed at $14.26 an ounce. Gold is on track for a 0.7% weekly rise, while silver is up 0.9%. Palladium futures PAZ8, +1.56% continued to advance, with the December contract up 0.8% a day after logging a record close.
“While we remain positive on gold prices going toward and into 2019, gold still seems to lack clear price directionality for the time being, but global jitters are certainly emerging,” said Christopher Louney, analyst at RBC Capital Markets, in a note.
Gold’s lackluster performance comes despite a tumble by equity markets, a plunge by oil, growing worries about stresses in the global economy, continued trade tensions and uncertainty over longer term growth trends, Louney noted.
However, while the U.S. dollar remains the strongest and most consistent factor for gold, “it’s likely in our view that correlations with other asset classes will begin to strengthen and re-emerge over the next 6-12 months and thus reassert themselves in gold’s favor,” Louney said. “While new positions may not appear entirely attractive at the moment, they are likely prudent over the longer-term.”
The ICE U.S. Dollar Index DXY, -0.19% a measure of the U.S. currency against a basket of six major rivals, was up 0.1% Friday and for the week. Gold and the dollar often have an inverse relationship.
Analysts at Commerzbank argued that palladium’s price rise, pushing the metal up nearly 40% since mid-August, was “excessive.”
“Thanks to its strong upsurge yesterday, the palladium price has come to within a good $30 of the gold price for a time, something we would not have believed possible just a few months ago,” they said, in a note.
In other metals trade, January platinum PLF9, -0.27% fell 0.3% to $842.90 an ounce, while December copper HGZ8, -0.15% was off 0.2% at $2.7415 a pound.
